Can Ford Hold off Both General Motors and Tesla?

Ford (NYSE: F) will release its quarterly report on Thursday, and shareholders are excited to see the stock starting to return to its early 2011 highs. Both Ford and General Motors (NYSE: GM) have greatly benefited from the boom in U.S. car sales. For long-term Ford earnings growth, though, the bigger threat could come from the sort of revolutionary innovation that we've already seen from electric-car specialist Tesla Motors (NASDAQ: TSLA) .

Ford has impressed investors and the general American public alike with its determination in coming back from near-failure. Unlike General Motors and Chrysler, Ford managed to get through the financial crisis without government assistance, and the restoration of its investment-grade credit rating and its dividend payout have marked important milestones in the automaker's recovery. Yet Tesla's emergence and the interplay of other innovations in car and track technology will challenge Ford to maintain its competitive position. Let's take an early look at what's been happening with Ford over the past quarter and what we're likely to see in its report.

Stats on Ford

Analyst EPS Estimate

$0.36

Change From Year-Ago EPS

(10%)

Revenue Estimate

$34.04 billion

Change From Year-Ago Revenue

12.5%

Earnings Beats in Past Four Quarters

4

Source: Yahoo! Finance.

Will Ford earnings stall out this quarter?In recent months, analysts have gotten a lot more optimistic about Ford earnings prospects, boosting their third-quarter and full-year 2013 estimates by nearly 10%. The stock kept climbing, rising another 4% since late July.

Ford even managed to outpace General Motors in September, a month in which overall auto sales were weak due to calendar effects. Even as the Chevy Silverado saw big declines in sales, Ford F-Series sales were up 10%. More broadly, Ford's car segment has also produced some big successes, including its Fusion and Focus models. Overall, Ford's well-balanced product sales allow it to appeal to a wider range of car buyers, which could help it hold off Tesla's attack on the high-end of the market as well as GM's more extensive competition.

Yet Ford can't afford to rest on its laurels. For a long time, electric vehicles have posed no threat to Ford's image, especially with its muscle-car Mustang model. But both of Tesla's models, the Roadster and the Model S Performance sedan, managed to outpace the 2013 Mustang GT 5.0 in zero-to-60 performance. General Motors is working on an all-electric vehicle that can get into Tesla's ballpark in terms of range. Ford CEO Alan Mulally said recently that he sees Ford moving toward more electrification going forward, but that the most economical fuel-efficiency benefit currently comes from hybrid vehicles.

One interesting innovation from Ford is a factory-equipped F-150 that can run on natural gas. Existing nat-gas vehicles have focused on the larger F-250 and F-350 lines, but many customers would prefer the smaller F-150. With partner Westport Innovations (NASDAQ: WPRT) working to capitalize on the cheaper fuel, Ford could see even more F-150 sales boost its bottom line.

In the Ford earnings report, watch for guidance on how far Ford thinks it can carry its latest growth spurt. Even with the company having made so much progress in just a few short years, Ford still has plenty of potential to capture pent-up demand for new vehicles even in the face of Tesla's emergence and GM's ever-present competitive threat.

Is natural gas in Ford's future?An under-the-radar auto company has giants like Ford and GM clamoring for access to its revolutionary technology. Many forward-thinking car enthusiasts are plowing money into this little-known stock... because they know it holds a key to the explosive profit power of the coming "no choice fuel revolution." Luckily, there's still time for you to get on board if you act quickly. All the details are inside an exclusive report from The Motley Fool. Click here for the full story!

Click here to add Ford to My Watchlist, which can find all of our Foolish analysis on it and all your other stocks.

Fool contributor Dan Caplinger has no position in any stocks mentioned. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends Ford, General Motors, Tesla Motors, and Westport Innovations. The Motley Fool owns shares of Ford, Tesla Motors, and Westport Innovations. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment icon found on every comment.

Everybody I know is buying Tesla stock, Tesla will own the auto business within 5 years. Most auto manufacturers will be out of business, because of Tesla and Musk. The 15 new plants, Tesla is building, should be producing at least 10 million vehicles within 5 years.